#USDINR @ 82.7625 stays defensive amid sluggish markets, grinds lower of late. (Pivot Orderbook analysis)

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• USD/INR stays defensive amid sluggish markets, grinds lower of late.
• China Covid concerns weigh on risk profile in Asia but softer US Treasury yields probe Indian Rupee bears.
• India Trade Deficit for Q3, US Initial Jobless Claims eyed for fresh impulse.

The pair currently trades last at 82.7625.

The previous day high was 83.0322 while the previous day low was 82.7178. The daily 38.2% Fib levels comes at 82.9121, expected to provide resistance. Similarly, the daily 61.8% fib level is at 82.8379, expected to provide resistance.

USD/INR holds lower ground near 82.75 as bulls and bears jostle during Thursday’s Asian session.

The Indian Rupee (INR) pair welcomed bears the previous day but the broadly firmer US Dollar challenges the downside moves before the latest weakness, mainly due to the downbeat US Treasury yields. In doing so, the quote cheers softer Oil prices amid lackluster trading days through the end of 2022.

That said, the US 10-year Treasury yields drop 2.8 basis points to 3.858% by the press time, after rising the most since October 19 the previous day. The pullback in the benchmark US bond coupons from a three-week high also weighs on the US Dollar Index (DXY), down 0.15% intraday near 104.35 by the press time.

It’s worth noting, however, that the sour sentiment in the Asia-Pacific markets, mainly due to China-linked Covid woes, seems to challenge the USD/INR bears. On the contrary, WTI crude oil’s weakness allows the Indian Rupee (INR) to remain firmer, due to India’s reliance on energy imports.

Multiple countries, including India, announced requirements of Covid tests for Chinese travelers as doubts over Beijing’s reporting of data and a hidden jump in the virus numbers weigh on sentiment. On the same line could be Russia’s rejection of peace with Ukraine unless it accepts the treaty allowing additional territories, as well as an escalated war in the city of Kherson.

Against this backdrop, MSCI’s Index of Asia-Pacific outside Japan extend the previous day’s losses while India’s BSE Sensex drops half a percent at the latest.

Moving on, the India Trade Deficit for the third quarter (Q3) will precede Infrastructure Output for November to direct short-term USD/INR moves. On the other hand, weekly prints of the US Initial Jobless Claims and Chicago PMI for December will be eyed for short-term directions. Overall, the year-end inaction could allow the pair to consolidate the monthly gains.

Although multiple failures to cross the 83.00 hurdle on a daily closing basis keep USD/INR bears hopeful, the 21-DMA support restricts the immediate downside of the pair to around 82.45.

Technical Levels: Supports and Resistances

USDINR currently trading at 82.7845 at the time of writing. Pair opened at 82.823 and is trading with a change of -0.05% % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 82.4518, 50 SMA 82.0968, 100 SMA @ 81.3505 and 200 SMA @ 79.5691.

The previous day high was 83.0322 while the previous day low was 82.7178. The daily 38.2% Fib levels comes at 82.9121, expected to provide resistance. Similarly, the daily 61.8% fib level is at 82.8379, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 82.6831, 82.5433, 82.3687
• Pivot resistance is noted at 82.9975, 83.1721, 83.3119

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